That doesn’t make sense. It’s not like SOTA models are error free, yet we still use them.
You use Fable 5 right? If that’s good enough for you now, why wouldn’t a Chinese model that’s as good as Fable 5 but at 10% the cost be good enough in 6 months?
I think we put up with Fable's occasional hiccups because there's nothing better at the moment.
I use Claude Code semi-heavily for my small business, and the $100/mo I pay for that is a rounding error compared to the value it provides.
If I can avoid spending an hour or two "massaging" the output from a lower-end model once, or it avoids introducing one load-bearing (sorry, couldn't resist) bug, then that's the entire $100 right there.
Hell, you could argue that the best "coding model" that we have at the moment is the human brain, and people will gladly pay $10,000/mo for one of them.
Arguing over $20 vs $100 for something that actually puts in work just seems insane to me.
The question low cost models will create: Why would you massage output?
Fable 5 is still going to mess things up at any sufficient complexity. The advantage of low cost models with "good enough" intelligence is they can recursively correct. Why? Because it is cheap. Proper requirements and tests and subagents take away increasing amounts of work, at a cost that is not prohibitive.
If you are reviewing code manually you might consider Fable 5 a worse option. As it articulates itself with higher confidence and you already know it is capable, you are may be more likely to miss a mistake. You know to be on guard with a junior engineer. Reviewing a senior who suddenly makes some weird stochastic mistake can be a lot harder. It would be like if the smartest human engineer you knew was capable of some random brainfart in the middle of their massive diff. Imo, much harder to deal with.
Of course, we should keep in mind Fable 5 is only expensive today. It will be cheaper in the future. Autonomous, recursive prompting and improvement is the clear end state. Especially for entities that will always have the budget for that at the SOTA frontier.
> I think we put up with Fable's occasional hiccups because there's nothing better at the moment.
Which was an argument for using every less powerful model since the moment they got useful, right?
When was that? Opus 4.5 maybe? Let's say Opus 4.5 for the sake of the argument. So back then we were like "DeepSeek is not good enough, I need Opus 4.5". Now DeepSeek is better than Opus 4.5. So if Opus 4.5 was good enough back then, DeepSeek is better than that now.
Sure, it's always nicer to have a slightly better model. But the price difference starts mattering a lot more when all the models are already sufficiently good.
To put actual numbers on it, since using AI to start solving all kinds of bottlenecks/inefficiencies in our small business, we've seen monthly net profit go up by around $4,000 USD. These are semi-permanent fixes, and the tech is only partially deployed. I am the only one using it, and I only use it part time.
We've just spun up our first Hermes agent, with direct API access to our main inventory system and that's expected to find another few grand per month in misallocation/inefficiency.
I wouldn't be surprised if we were doing more like $10k/mo higher in 6-9 months' time.
When you're talking about numbers like this, the fact that one AI is $100/mo and another is $10/mo or $40/mo doesn't matter. They could make GLM-5.2, or any other Opus 4.5-class model free and it still wouldn't make sense to deploy in a commercial context.
The other angle I'd approach things from is that Opus 4.5 (and I'd agree with you that that model was the saddle point) was "good enough" for the types of things we were asking it to do back then, but as the models have become more capable the tasks we're asking them to do have also expanded with it.
I know I've personally gone from "hey can fix this race condition with a Redis mutex" 6 months ago to "Independently redesign this full embedded USB stack and QA it end-to-end, working around a specific Kernel bug in macOS Tahoe that requires decompilation to find the source of, while keeping in mind the constraints of our 8-bit AVR chip from 2011" now.
But that said, yes, maybe in 5 years' time we will reach an "intelligence saturation" where the average person won't be able to even conceive of how to use the new SOTA.
I think we're even starting to reach that saturation point now for a lot of people. In my industry (law) plenty of people have tried CoPilot once or twice, or tried ChatGPT a year ago, and as a result have basically dismissed AI as being useless. The setup required to be able to get it to do end to end tasks to your liking is also substantially more work than most people are willing to put in.
"оur first Hermes agent, with direct API access to our main inventory system" – let me assure you that absolutely nothing can go wrong here, mate. /s
[delayed]
Except Fable won’t be costing $100 for enterprises that will be considering the Chinese models.
If $100 Claud Max subscription works for you, then great.
But you have to remember your pricing is subsidized by enterprises that pay hundreds of thousands of dollars each month, if not more, to Anthropic.
For those companies, a Chinese model that can cut their AI spend from $1M/month to $200k suddenly seems attractive.
And unfortunately for the American tech industry, the valuation is based off those enterprise deals, not your $100/month Claude Max subscription.
Didn’t deepseek recently announce prices will go up significantly?
Right now the US dominates everyone else in actual chips in data centers. So even if deepseek etc tries to undercut, they’re very capacity limited.
It's far from significant, it's partially doubled during peak hours. They could 16x it and it would still be two orders of magnitude better value than OAI's $200/mo plan.
It's that good. They are far from capacity limited, and even if they were, you can rent a single MI300X from somewhere like Hot Aisle and get more tk/s than you'll be able to use.
Deepseek is open weight/source ie it will be running on US servers in the US maybe by on each companies own servers.
> not your $100/month..
This is made brutally obvious by anthropics customer support for people with such accounts.
Yeah, fair. If we were talking $2,000/mo vs $200 then the maths starts looking very different.